Tax extension: 20 million Americans took advantage of 2020 July tax extension, but what if you need more time?

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SALT LAKE CITY (ABC4 News) – In early 2020 the nation faced a massive shutdown due to the COVID-19 pandemic, and those who hadn’t filed their taxes gained a little extra time to file their taxes…a three-month extension. As that “second tax day” is looming, new research from a national finance company, IPX 1031, shows that about 22 million Americans took advantage of the extension deadline. In fact, the week the filing extension was announced, 2.4 million fewer Americans filed their taxes compared to the same week in 2019.

The study gathered data by analyzing Google searches in all 50 states and the 30 largest cities in America during last year’s tax season (January – April 2019). The analysis seached phrases and questions related to keywords such as “can I file taxes late,” “need tax extension” and “last day to file taxes” as well variations of those keywords and phrases.

Researchers found that Nevada was the biggest offender of states that procrastinate in filing their taxes followed by:

  • Colorado # 2
  • Texas # 3
  • Oregon # 4
  • Washington # 5
  • Arizona # 6
  • Hawaii # 7
  • Georgia # 8
  • Maryland # 10
  • Utah ranked (No. 19).

In regards to states who procrastinate the least, most are located in the Midwest such as Iowa, South Dakota, Nebraska, Michigan, Wisconsin, Missouri and Indiana.

But procrastination isn’t just something that’s common in certain parts of the country. According to the IRS, the most popular time to file taxes is the very last week you can file without an extension.

Coronavirus has also affected many individual’s finances, and even with the July 15th extension, some may need even more time. The Internal Revenue Service is offering additional relief for those who would like a further extension. Using the E-form your extension form on the IRS website, tax payers may be able to get another three-month grace period until October 15, to file their 2019 taxes. To get the extension, you must estimate your tax liability on this form and should also pay any amount due.

The IRS advises the following:

  • An extension of time to file your return does not grant you any extension of time to pay your taxes. 
  • You should estimate and pay any owed taxes by your regular deadline to help avoid possible penalties.
  • You must file your extension request no later than the regular due date of your return.

Source IRS.gov

With the economic downtown caused by Covid-19, 2020 saw significant changes as to when Americans filed their taxes. The IRS and Treasury Department pushed the original Tax Day of April 15 to July 15. In fact, during the week that the filing extension announcement was made, 2.4 million fewer Americans filed their taxes compared to the same filing week in 2019. One of the biggest year-over-year drops in filings occurred the week ending in April 10. Compared to the same week in 2019, 9.3 million fewer Americans filed their taxes.

Courtesy: IPX 1031

According to IRS filing data, over 20 million Americans utilized the extension.

Other notable takeaways from the study:

  • Millennials expect to receive to the most money back on their tax returns $2,476
  • Baby boomers expect the least $946
  • 27% of Americans say the pandemic has changed how they plan to spend their tax refund (if they’re getting one).
  • 42% of Americans were unaware the new tax day is July 15.

IPX 1031 Sources: 2019 and 2020 tax return filing statistics – Internal Revenue Service.

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